N.H. joins national foreclosure investigation

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New Hampshire has joined a nationwide investigation into the foreclosure practices of mortgage companies.What began as sporadic reports of improperly foreclosed mortgages has expanded into a full review and investigation in all 50 states of the proceedings of mortgage servicers and has led to a complete halt in the practice in some states.At the heart of the issue is what analysts are calling "robo-signing" – processing clerks simply signing off on foreclosure notices without performing a thorough review of the paperwork."The bottom line is that, once some of major banks uncovered irregularities in affidavits, they halted all foreclosures in states requiring judicial review," said Karen Gorham, assistant attorney general in New Hampshire. "We’re looking for assurance here, a non-judicial state, that there were no irregularities."Gorham said 23 states require lenders to file a foreclosure affidavit with the state court for judicial review. New Hampshire does not have such a requirement, "but foreclosure affidavits here still have to be reviewed by the Registry of Deeds," she said.To date, Bank of America has put a temporary stop to its foreclosure proceedings nationwide. JP Morgan took a deeper look into its foreclosure files, saying Wednesday that they were processed properly.Gorham said there has been no foreclosure freeze in the Granite State.The multi-state investigation – led by the Iowa attorney general– is concerned that "submitting foreclosure documents without verification, with false representation, and/or signing certain legal documents outside the presence of a notary public may constitute deceptive acts and/or unfair practices, and may otherwise violate state laws and court rules," said the signatories of the multi-state task force in a letter about the matter.The initial objectives of the multi-state investigation also include: • Putting an immediate stop to improper mortgage foreclosure practices. • Reviewing past and present practices by mortgage servicers subject to the inquiry. • Evaluating potential remedies for past practices and to deter future improper practices. • Establishing a mechanism for more effective independent monitoring of future mortgage foreclosure practices.While she did not mention any specific lenders in New Hampshire that are under review, Gorham did say the multi-state task force would be reviewing "all loan servicers" in the country.According to the New Hampshire Housing Finance Authority, there were 408 foreclosure deeds recorded in the state in August -- a record high for the month. August, it said, was "the eighth month in a row with an increase over the same month in the prior year" putting 2010 on track for being a record-breaking year. The authority said that there have been 2,942 foreclosures in New Hampshire year to date.Gorham said she doesn’t know what the scope of the issue is in New Hampshire yet, or even if there is any major concern."That’s what we intend to find out in the task force," she said.In addition to the 50 state attorneys general, some three dozen state banking and mortgage regulators also are participating in the investigation, include the New Hampshire Banking Department. – CINDY KIBBE/NEW HAMPSHIRE BUSINESS REVIEW

This article appears in the December 9 2016 issue of New Hampshire Business Review